So how does this affect the housing industry?

A flood of new homes and condo developments certainly adds more competition to listings and dilutes housing inventory. So should real estate investors be concerned?

Will this back pedal on recent gains and make it tougher to stand out and sell homes?

This is unlikely for the most part. Obviously home builders aren’t rushing to build endless developments in those areas which are still swamped in foreclosures. They are going where the demand and jobs are. So this should in fact offer some relief; balancing the amount of inventory on the market and preventing bubbles.

Of course with existing homes in most areas of the country still being sold for far under re-build cost new home builders can’t really offer the same deals real estate investors can. So if anything this often helps by making new construction act as a pinball machine and pushing buyers to investor’s homes which all of a sudden look like a much better deal.

Plus, those new properties which do get sold are helping to lift local home values, increasing the value of properties being held and spreads for those flipping houses.

During the last real estate boom many investors made a killing on new construction, so should today’s investor be considering jumping on the wagon and snapping up some of these properties?

While luxury homes and lavish condos can be very attractive that doesn’t necessarily make them a good buy. In fact, the ROI on new construction today is probably pretty horrible in most cases today, especially when you factor in the high cost of missing out on other deals with higher returns and the high risk pre-construction condominium projects and new homes come with. So for now perhaps it is best for most real estate investors to give these types of properties a miss.

Flipping new construction contracts became popular right before the bubble burst 6 or 7 years ago and will become enticing once demand for these types of units consistently sell out way in advance again and investors are 110% certain they can walk out the door and assign their purchase contracts to someone else for big bucks.

However, builders just keep getting smarter and slicker and have an eye on this. In fact they began to deny and void these assignments on properties which had big spreads so that they could resell the units and keep the profits themselves. So be careful and have a good attorney if you are trying this or you could have end buyers chasing you for their assignment fees to be returned.

Being a high achiever when it comes to credit score means having that extra wiggle room when you need it, as well as getting better terms on everything else so that you can keep more of the real estate investing profits you bring in. Plus, knowing what makes for a good credit score can definitely help to spot good credit clients and help build others up so that they can buy homes from you.

So what does it take to be a high achiever when it comes to your credit report?

According to a recent Inman News report and Fair Isaac Corp. (FICO) more than 50 million people are considered ‘high achievers’ with credit scores of 785 or above.

So if you could profile or model these high achievers what does their credit look like and what are their habits?

•    Have an average of 7 credit cards (closed or open)
•    Use only an average of 7% of their revolving credit limits
•    96% show no late payments on their credit reports
Of those who have been approved for a mortgage recently:
•    They made an average down payment of 22%
•    Their housing payments did not exceed 23% of their monthly income
•    Their total monthly obligations did not exceed 34% of gross monthly income
5 Factors Affecting FICO Credit Scores by Weight:
•    Payment History
•    Amounts Owed
•    Length of Credit History
•    New Credit
•    Types of Credit Used

According to reports like these and from mortgage firms and real estate portals like Zillow (yes the one infamous for incorrect information), there is still a massive percentage of Americans who still have great credit. This may appear to be extremely contradictory compared to what real estate investors are encountering on the street but it is encouraging and bodes well for the housing recovery.

Still with a good 7 years since the bubble burst many Americans are also already well on their way to mending their credit and those who took the hit earliest should soon see negative items falling off of their credit reports. This means more eligible home buyers and another surge in home buying to come.

By staying on top of good credit practices and being willing to serve those who don’t have perfect credit right now real estate investors can absolutely line up a fat pipeline of deals to close in the coming months.

Plus, if you’ll give these credit challenged buyers the time of day now when others won’t they will become incredibly loyal and even become great referral sources later. So in your rush to make a quick buck from the real estate market today, don’t forget about securing your profits for the future and growing your real estate investing business.

While hitting almost $38 billion in revenues like Google last year may seem a little far off but it doesn’t have to be. However, being the Google of your real estate market isn’t even about dollars and it definitely isn’t about creating your own search engine. That is way over done, though there may be a few niches that could work for being the preferred real estate investing search engine.

What’s being the real estate investing Google is really about is market dominance and influence. While perhaps not that intelligent most see Google as the guide to the universe and their guide to making decisions, while it directly and indirectly controls opinion and a major percentage of dollars spent each year.

6 Ways to Become the Google of Your Real Estate Market

1. Be the Dominant Brand

This is a relatively easy one for real estate investors to get, though offline it may not always be cheap. Flooding the area with billboards, bench and bus ads, signs and print ads can achieve this relatively quickly but it can cost a pretty penny too. This can sometimes be achieved in more affordable ways in print and mail and signage while still reaching everyone but of course becomes even easier online, and as the boundaries between virtual and reality blur thanks to mobile devices there may soon not be much difference.

2. Be the Preferred Resource

Google is the preferred resource for a number of reasons from the vastness of data is serves to focusing on quality results, to tying people in with auxiliary products to simply because everyone else is using it. So add more content, expand services, do great work and offer value.

3. Be the Map

Be the map to where they want to go and a reliable one!

4. Get Way Ahead

The recent Apple Maps debacle was easily predicted to happen because Google has invested so much and so many years into building its maps. There is just no way for anyone else to serve up the same quality unless they copy it; the lead is too large and too expensive to compete against. Now people won’t even accept a cheaper imitation if it’s free. So be the map to great real estate investment returns, to happy homeownership to peace of mind and financial success and get so far ahead in at least one element that you can’t be touched or replaced.

5. Embrace Technology

This really speaks for itself for real estate investors, though finding more ways to work with Google might be a good path too.

6. “Don’t be Evil”

The unofficial Google motto and point 6 in its philosophy is “You can make money without doing evil”. Whether the firm still follows this today is highly debatable but without a doubt putting off being evil and forgoing short term gains to stay around for the long run is just smart business, especially for real estate investing pros. Once you’re as wealthy as Google, then you can apparently re-evaluate ethics and buy your way out of trouble.

Black Friday, the day after Thanksgiving is known as one of the biggest shopping days of the year but with the popularity of online shopping and consumers tired of battling crowds in stores the following (Cyber) Monday has blossomed into a major annual event, with ‘Cyber Week’ sales topping $6 billion last year.

This is a big sale day for real estate investors to grab up deals on all types of items for fueling their businesses and getting discounts to maximize marketing ROI and the spreads on properties being flipped.

Stores like Home Depot run special sales so that real estate investing companies can scoop up big savings on appliances, and finishes like hardware and lighting fixtures as well as tools and other building materials to build in more profit margins to their deals.

With so many new electronic devices coming out and the need for investors to stay wired into to the latest marketing platforms as well as improving their own flexibility and time management and finding good deals on holiday gifts this is a sweet time to grab the latest mobile devices and smartphones.

Of course real estate investors shouldn’t forget to cash in on all of the other shoppers and money being thrown around to sell more homes themselves either.

Cyber Monday is going to see masses of internet traffic, which investors ought to be capitalizing on with their own PPC ads, banners, social media campaigns and seasonal sales. Maybe it is offering 10% off on homes on the day or 25% off the cost to join your foreclosure property tour.

However, it pays to get started early as other retailers will begin rolling out their own sales in advance too. Most people work on the Monday and may have more freedom to shop over the previous weekend.

Investors should also consider cashing in on all of the traffic on Black Friday. There will be a ton of web traffic then as shoppers look up sales to visit and there will be a lot of foot and car traffic on the move too which can be captured with signs and other displays ads.

In fact property investors are probably smart to start sending out emails the day before Thanksgiving and all the way through Cyber Monday. Prospects will have a lot of time off from Thanksgiving Day forward but they can also be distracted but this is one occasion when you can probably hit them daily without being too annoying, especially if you are offering something valuable. The same goes for social too, especially with its power to show up on top of search engines, so keep seasonal keywords in mind more making the most out of it too. Even if you don’t have anything to put on sale this could be a great time to pick up more likes and social followers and build your email lists.

Outsourcing has gone from being a novel new trend for lowering business costs, speeding up the growth of new startups, enhancing flexibility and scalability and increasing profit margins to becoming an essential hiring solution for businesses of all sizes in all industries. This is especially true of real estate investing companies and the Philippines has been one of the main sources of outsourced staffing until now but that could all be about to change.

The recently passed Cybercrime Prevention Act of 2012 just signed into law in the Philippines threatens to dramatically restrict the job functions which its citizens and residents can perform. While this new law may have been well intentioned it certainly threatens to rocket high unemployment in the country and while it may outlaw sensible things such as spamming this also extends to who Filipinos can like on Facebook and will outlaw many functions for which these low cost outsourced staff are most often hired for including email campaigns, social media, etc. At tens of thousands of dollars in fines and over a decade per offense you can bet that few may want to take the risks of bucking the new regulations too.

Of course there are other overseas countries for real estate investing companies to outsource to on the cheap such as India and Bangladesh but we have actually already being seeing a new trend in more outsourcing being done onshore, with the hiring of more U.S. based remote workers. While perhaps not as cheap as outsourcing overseas it provides better quality staff, with a better understanding of the local market and easier communication, frequently resulting in higher quality work and better results with less management needed.

However, this new law means that in addition to the swarm of new competition investors have already been facing from other real estate companies and investors jumping into the market they will now have even more competitors bidding on the best U.S. based remote workers.

Unfortunately we all know that whoever has the best talent on their side has the edge and is likely to continue to widen the gap and stay ahead. So for serious real estate investing pros who really want to make the big money, enjoy more freedom and stay ahead of the competition this is definitely the time to lock up the best outsourced team members for all upcoming lead generation and marketing efforts.

Choosing to continue to put it off could mean being left hanging and business stalling if staff from the Philippines quit or simply not being able to access or affordable good talent to bring plans together for a great year of investing in real estate. This is already an increasingly difficult problem in the tech sector and will soon hit real estate in a much bigger way despite such a high national unemployment rate.

The decision to take real estate investing education to the next level with coaching is one which often confuses newer investors and fuels ongoing debates in forums on the web but all too often individuals are focused on the wrong criteria…

5 Rules for Evaluating a Real Estate Coaching Program

1. Returns

When calculating this step investors all too often get hung up on the amount of the investment versus the returns. Sure, there are hundreds of cheap books available in the used bookstore, on Amazon and even full real estate investing programs on eBay because they are a decade out of date. Unfortunately if they don’t really provide value or the right structure for success today it’s just money wasted. Ask how much return you can expect to find in a program; will it pay for itself in the first deal and will it lead to years of six and seven figure incomes? What’s that worth?

2. Speed of Returns

One of the main problems with the DIY approach to real estate education is that it often lacks structure and depth and being so fragmented means investors do more learning by trial and error than anything else. Wouldn’t you rather find an organized course which fast tracks you to closing your first profitable deals and your first million?

3. Avoiding Losses

This is the most overlooked of all criteria when it comes to choosing to make the leap to real estate investing coaching. Most are simply focused on the gains to be had but the truth is that without advanced education investors have a lot to lose and can lose their shirts (and shoes) very quickly. One bad investment or move can cost tens or hundreds of thousands of dollars, isn’t that worth avoiding.

4. Quality of the Program

Obviously not all real estate investing programs or coaching courses are created equal. Crucial questions to ask include:

• Does this still work today?
• Has it really been proven to work in the past?
• What support is really being provided?
• Will the strategies being taught still work tomorrow?
• How easy is the system to follow?
• Is this coach a good match and represents what I want to achieve?

5. Compare the Alternative

Now you have a good idea of the value of the real estate coaching program you are considering, ask what the pain from not investing in it will be.

If you don’t get help it will certainly take a lot longer to see the same level of success even if you could do it on your own, though you may never truly reach your full personal potential without it and that alone is perhaps the most important factor.

Think long term, weigh all the benefits and how this coaching program can help create a sound real estate investing business which can last and grow for decades, not just provide you with a really tasty paycheck next month.

Should you seek out a college real estate education before getting started or is it all just about picking up a book from Amazon or a late night infomercial and jumping in to get some hands on experience? It looks so easy on reality TV right?

Is Your Major a Major Issue for Real Estate Investing Success?

Many of those who have spent many thousands of dollars on their college educations may not like the answers.

Americans have been lured into taking on an incredible amount of student loan debt in recent years and it is common knowledge that even many masters degree holders from the top schools in the country can’t get jobs. Just imagine if all that money had been invested in real estate!

Even when looking to get hired by someone else, whether in the field of real estate or not degrees unfortunately matter far less today than they used to. A look at jobs ads may reveal many more companies listing a degree as a requirement as they can afford to be more choosy when hiring today than ever before but when it comes down to it GPA and practical experience carry far more weight.

Even for the top positions at the world’s toughest places to get hired relevant skills and experience trump a paper degree in all but a few licensed professions and institutions which make them mandatory.

So Real Estate Investing Success is all Just about Getting Your Hands Dirty?

Yes and no…

There are endless rags to riches tales of real estate investors who have made millions with no formal education. Some are true and some are myths invented by creative marketing geniuses trying to cash in as real estate investing ‘gurus’.

There is a lot of common sense involved in profitable real estate investment and some have made it big buy flipping houses with very little formal education.

However, there is so much involved in real estate investing and so many pitfalls it is virtual financial suicide not to go in armed with a decent real estate education. That doesn’t even factor in if you really want to go big and make the big money fast.

This doesn’t mean a real estate degree is necessarily the best path or that putting of investing in real estate for 4 more years is smart by any means but a practical education is critical to success.

What Type of Real Estate Education do You Need?

The great news is that effective real estate investing can be scaled. You can start out with a good real estate investing course and then move up to coaching as you get going or if you are serious about kick starting your business with a bang and guaranteeing your long term success.

The key factors you should be looking for in a good education to ensure profitability and longevity include:

• The technical side of real estate transactions & the law
• Real estate investing strategy
• Marketing
• Business management

Could this be accurate and if so what does it mean for American homeowners, home buyers and ambitious real estate investors?

No Housing Rebound until 2026?

It isn’t that we won’t see a housing rebound for another 14 years or that we are not already at the beginning of a recovery, but some ‘experts’ are claiming it could take this long for U.S. home values to return to their highs of 2007.

Are they right?

Analysts recently made a case for this argument in a story on CNN Money, backed up by their own data. We know the press is in desperate need of readers and any sensational headline helps that but could it really take that long?

According to the national housing statistics used and the forecasts one firm made of low single digit home price growth over the coming years, then yes it could. With home values down some 60% in many areas and based on a sub 5% rate of growth it could take many years for homeowners to see their equity return, if they can hold out that long.

The Cracks in the Forecasts

However, the good news is that there are fatal flaws in these forecasts and the data they are based on, if they aren’t completely unrealistic all together.

For a start, it is widely accepted that current indices which gauge home values based upon median home sales prices are wildly out of touch. This has been blown out of proportion even further by the fact that the bulk of real estate sales activity has been limited to the extreme low end of the market in recent years. So obviously if luxury homes aren’t changing hands but tear downs at $10,000 a pop are being traded every day it is going to skew those stats way out of whack and doesn’t necessarily reflect a change in the value of higher end homes at all.

We are now finally getting to see some movement at the top end of the market so even with the flawed system we should see significant spikes in home prices in coming months.

Then there is the disparity in local housing prices and trends compared to national ones. National stats may present a rough picture of the direction of the whole nation but they also don’t reveal the markets which are still lagging and how spectacular some are performing.

A closer look shows some zip codes rocketing up by high double and even triple digits in home prices in the last 12 months, completely trashing the above predictions of a far off rebound in home equity.

No matter how you look at it and where you look the bottom line is that based on historical housing cycles home prices ought to easily surpass their previous highs within the next 10 to 15 years.

The Bottom Line

1. Struggling homeowners need to wake up and sell now before incentives disappear
2. Home buyers will only hurt themselves and pay far more if they wait to buy, especially when factoring in interest rates
3. Real estate investors should seize on this great moment for huge growth prospects, great cash flow spreads and pay attention to local stats & trends

There has recently been a surge in promoting the use of and bragging about using credit partners in some popular real estate forums as newer investors discover this way of leveraging more capital.

For those unfamiliar with this strategy it involves using other people’s credit to qualify for conventional mortgage loans in order to leverage more properties and to benefit from better loan terms and rates. While in theory it can be advantageous many of these investors are unwittingly setting themselves up for disaster.

Danger #1: Legal Issues

It seems pretty shocking to see so many investors publicly bragging about using this strategy when at the same time many are being featured in the news for going to jail for the same thing. Of course there are certainly legal ways to do it. It depends on how you structure it, how you hold title, what agreements are drafted and how mortgage applications are made. However, investors must do everything possible to distance themselves from being seen as using ‘straw buyers’.  Those who have in the past are now daily being sent to prison for many decades.

Danger #2: Partners in General

Partners in any business dealings present an array of potential issues and these can become even more dangerous when it comes to investing in real estate. Giving up control to anyone else in when it comes to your investment properties invites all types of problems. Sharing title to a property can give another party the ability to strip the equity from homes behind your back, incurring additional liens on a property, having properties seized due to one party defaulting on other obligations and can mean big trouble if they don’t keep up with the financial obligations they agreed to. Don’t underestimate this; beyond the possibility of losing a single property and hundreds of thousands of dollars this easily has the potential to bankrupt your entire operation overnight.

Does this mean all partners are bad for real estate investing?

Not at all, it just means that investors need to be very careful in which types of partnerships they engage, how they are structured and who they partner with.

Perhaps it is better to focus on finding cash partners, referral partners, forging strategic partnerships for cross promoting and maximizing marketing ROI. or perhaps even just partnering for leveraging knowledge, expertise and databases of prospects.

Cleary the big lesson here is for new investors to first invest in their real estate investing education to help them avoid these dangerous mistakes and their severe consequences or going broke could be the least of worries.

This is not an over exaggeration. There are thousands of real estate players now in jail as a result of their ‘slick’ strategies blowing up and at best many others are broke, jobless and renting. For what? Willing to risk millions and their financial future and that of their kids on their own egos rather than make the minimal investment in their education which could have kept them on top.

According to new research and statistics real estate contract issues have been surging and some question whether it is holding back the current rebound from posting even better figures.

How Bad are Contract Defaults Becoming?

Data from the National Association of Realtors and Capital Economics shows a two year high in real estate contract cancellations at 18% between May and July 2012. That’s almost double of any time during the recent boom years.

Even worse, Realtors are reporting a 30% rise in contract problems which are now affecting nearly 40% of all real estate transactions. This includes delays and renegotiations as well as actual cancellations.

Why are So Many Contracts Falling Apart?

Of course appraisal issues remain one of the biggest challenges, though there are ways to minimize this between making better offers and sellers asking for more realistic asking prices.

This goes hand in hand with mortgage challenges causing a good percentage of deals to fall apart. It is no secret that underwriting has become tougher and real estate investing pros know how worthless most mortgage pre-approvals are. However, if borrowers and real estate agents made better choices about choosing better mortgage professionals to work with a lot of this may be able to be avoided to a certain extent too. This doesn’t always mean shooting for the big bank either. Often these low paid, poorly trained and under motivated employees are far less aggressive about closing deals and not as experienced about pre-empting issues as their independent mortgage broker counterparts.

Some real estate agents are also placing a lot of blame on buyers rushing to bid out of fear of being beat to the best properties only to decide they don’t like the property later. This of course is only increasing the bidding wars, while perhaps those who are more patient can negotiate better deals.

However, another part of this could be that home buyers could be getting smarter. In the past they may have followed through with contracts even if they found issues once in process, whereas they are now probably more likely to see the wisdom in cutting their losses early.

How Real Estate Investors Can Minimize These Issues

If this is your type of bidding strategy; throwing out offers and doing due diligence later, at least use as many contingencies in contracts as possible. Then make sure to further protect your earnest money deposit by depositing it with your own real estate attorney or title company and never with the seller or their agent.

When it comes to selling homes make sure there are minimal contingencies, check the financial strength of the buyer via a real proof of funds letter or mortgage pre-approval from a legitimate end lending institution.

Finally take backup offers and institute kick-out clauses and get to know your contracts better.